Consumer Bureau Director Cordray: Time to Change the Culture of How People Obtain Mortgages

“We are seeking to change the culture of how consumers go about obtaining mortgages in this country by making it more possible and more fruitful for them to shop around,” said Richard Cordray, director of the Consumer Financial Protection Bureau (CFPB), at a Brookings event today. In his remarks, Director Cordray outlined the bureau’s new set of tools, released today, called “Owning a Home,” designed to help consumers “throughout the home buying experience, from the very start of the process all the way to the closing table.”

Director Cordray observed that consumers typically shop around for many goods and services, from appliances to houses, but not for the right mortgage. According to a new study released today by the CFPB, almost half of consumers do not shop for a mortgage when they are buying a home. “The failure to look around can mean real money lost for consumers,” he explained. “By not shopping around, consumers are often throwing good money down the drain.”

Watch a video of Director Cordray’s remarks below:

“At the Consumer Bureau,” he said:

we are working to reduce the information gap between lenders, who understand mortgage pricing inside out, and consumers, to whom the process can often feel like a mystery. It is time to start changing the culture of how people obtain their mortgages. We need to change the process from one of “getting a mortgage,” as a passive activity, to one of “shopping for a mortgage,” a more active activity. Consumers have much more power than they may realize. They can use that power to take control of their financial outcomes.

Visiting Fellow Norman Eisen, former U.S. ambassador to the Czech Republic, introduced Director Cordray and moderated a question and answer session with the audience. Learn more about the event and get audio here.